Nowadays, many people try to start a business to earn additional income. This is what Evelyn Francisco did. She has ventured into several businesses like RTW, a mini grocery store, a review center, and currently an internet shop. Evelyn believes that it is normal to have financial problems when starting a new business, but once the business is established it is important to handle finances wisely to be able to maintain it.
Keep your money separated: Business money must be kept separate from personal money. You have to be strategic in putting your money in different accounts based on their functions. Money that comes from your business should be used as capital to purchase the products you sell and to pay the bills related to the business. The money that you use for your personal needs should not come from your business money. A friend who took a loan to start a sari-sari store made this mistake. She and her children took their food and other needs from the store and didn’t pay for them. The store went bankrupt and the family was not able to pay the loan.
Keep accounts: Keep daily, weekly, or monthly records of your business accounts in order to monitor your finances. These records will tell you if you are making a profit or not by providing a record of expenses and of how much money remains in your account.
Save for emergency: Based on your earnings from the business, save a certain percentage that will serve as an emergency fund if there is a need that arises like an expansion for the business.
Only borrow if your profit is greater than your business loan: If you want to expand, and your capital and savings are not enough, you can borrow from banks or any private financial institution if the earning you incur from the expansion is greater than what you will pay for the loan.
Along with hard work, following this advice can insure that your business earns the additional income you desire.
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